In a bull market, sharp declines occur frequently, driven by a series of market operational considerations. First, the market needs to undergo severe fluctuations to 'cleanse' the retail investors – that is, to eliminate them. Because retail investors generally have a strong willingness to hold onto their stocks and high stickiness, they often are reluctant to easily sell their assets, thus requiring a sharp drop to force them to sell. In fact, sharp declines may need to happen repeatedly to effectively wash out most retail investors.
So, why cleanse retail investors? Many may think that it would be better for everyone to make money together. But from the perspective of the market leaders, the situation is not so simple. Without new capital inflow, if retail investors are not washed out, the leaders will face huge financial pressure when pushing up the coin price. Once retail investors make a profit, they often choose to sell, causing the leaders to constantly encounter selling pressure during the upward process, increasing costs, almost like 'carrying the sedan chair' for retail investors.
Therefore, after cleansing retail investors through sharp declines and other means, the market will become clearer, allowing the leaders to continue pushing the coin price up without the interference of retail investors, and without the pressure of selling, the subsequent rise will be smoother. This operation helps the leaders gain a larger profit margin and provides better upward space for future market conditions.